Economic Update 3-31-2025
Economic data included a slight upgrade to U.S. GDP for Q4, and positive news for durable goods orders and a variety of real estate sales and price data. However, consumer sentiment took another dip downward, due to high uncertainty about trade policy.
Equities fell around the world, with concern about upcoming trade policy and weakening consumer sentiment. Bonds were flattish with sticky inflation offsetting a usual risk-off response. Commodities were mixed, with energy prices a bit higher.
U.S. stocks began Monday positively, up nearly 2% upon hints that the President may back off the more extreme tariff measures on April 2, now only days away. However, by Wed., potential new tariffs on non-U.S. autos and auto parts soured the mood again, as did weakened consumer confidence as the result of policy uncertainty. Last week proved to be just another example of how closely financial markets are reacting to trade news above all else at this point, with some well-known firms issuing continued revisions upward for expected net tariff rates. By sector, stocks saw gains in more defensive consumer staples as well as energy, while technology and communications saw the sharpest declines. Real estate earned a small gain for the week.